Weekly Market Brief - with Text_Blog2

Market Brief – Monday 25th May 2015

This market brief is an overview of the week ahead and some of the events we see as being important to the markets.
Please be aware that our views may change throughout the course of the week, and we do not publish updates of such changes.
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AUSTRALASIA

ASX – 5665  ( – 76 or – 1.32% )

The ASX moved lower early in the week to only find strong support at the previous lows, this enabled it to bounce back up and break and close above the key level of 5636 with a long up bar.

If last weeks formation was the start of a continued strong move higher then we need to see 5715 and 5754 broken before reaching the Key FICM level of 5790. We will then need to see a long up bar break and close above 5790 before the continuation of the up move. If the momentum is strong then we could see 5842 reached.

If the ASX is to restart its move back down then we need to see an early break and close back past the key FICM level of 5636. If this occurs then we could see 5595 before reaching 5542. If the downward move is strong and we see a long down bar break past 5542 we could then see the ASX near the area between 5463 – 48.

EUROPE

DAX – 11840 ( + 378 or + 3.30% )

And we are off.

“The DAX will need to catch up to the rest of the markets sooner or later. As always DON’T BLINK or you’ll miss it. We think that anything goes with the DAX at the moment.”

For the upmove to continue this week we would like to see 12015 broken early in the week before reaching 12164 before making another attempt at reaching 12460 which would complete the range.

If we see continued issues (we mean comments by the media) with Greece then a strong early break back down past 11791 could reach 11621 quickly. If this level is then broken with continued strong momentum then 11373 could be seen quickly and finally back through 11292 – 57 before settling near 11163 again to complete the downside range.

US

S&P – 2127 ( + 4 or  + 0.19% )

The S&P moved sideways last week therefore our comments remain the same.

The two important levels that the S&P needs to hold are 2112 and 2126. If the upward momentum is strong we could see 2137 broken with a long up bar reaching 2148. This could then lead the S&P to overextend itself towards the area between 2173 – 80.

If the S&P breaks back down past 2112 with a long down bar then 2101 could be seen very quickly. Once this occurs we could see 2085 and 2076 once again. if the downside moves become aggressive then the area between 2050 – 46 could be seen.

FOREX

AUD.USD – 7830  ( – 205 or – 2.55% )

The rise of the AUD was short lived as rumours of a rate hike from the US were around. The AUD fell below 80 once again and did not look like it wanted to recover.

For the upmove to restart we would like to see and early strong break past 7869 before reaching 7927. If the move higher gets some traction then 8088 could be seen again.

For the longer term downside move to restart we would like to see a strong down bar break 7778 pushing through 7718. Once this occurs we could see 7635 again.

EUR.USD – 11010 ( – 436 or – 3.81% )

The EUR struggled to hold above 11400 as we saw a strong long down bar break early in the week which set the mood.

For the EUR to move back higher we really need to see a V shared reversal breaking back above 11038 before pushing towards 11166. Once this occurs we could see another attempt at reaching 11315 and possibly 11396.

If thats it for now on the upside for the EUR then another strong downbar break past the area between 10941 – 10899 could start an aggressive move towards 10780 and possibly extending to 10590.

GBP.USD – 15481 ( – 244 or – 1.55% )

“We will be watching this pair very closely this week as the move has extended itself.”

As we thought, an overextended move reverting back down to our key FICM level of 15448.

For the GBP to continue its strong move up we would like to see 15448 hold as a strong level of support before another move past 15644 is made. If this level is then broken with a long up bar then we could see 15834 tested.

For the down move to really start we would need to see the Key FICM level of 15448 broken early in the week with a long down bar. Then it will need to become a solid level of resistance pushing the pair down past 15366 and 15280 before reaching 15209 again.

USD.JPY – 12155 ( + 217 or + 1.55% )

Our Comments remain the same:

This pair is back to its old tricks as it moves sideways while any move lower is bought up quickly. We saw this last time around the 102 –  103 area just before the big move higher past 120 was made within 3 months.

This time the two levels are: 12064 upside and 11867 downside.

Therefore our comments remain the same. Be Prepared!!!!

For the USD to continue its rally we would like to see 12152 hold as a strong level of support pushing the pair past 12184. Once this occurs we could see the area between 12225 – 75 tested. If this is then broken with strong momentum we could see the pair near 12403 very quickly. (for members – you can see how we have calculated the levels on the chart – please log in)

If it’s too hard for the USDJPY to stay above 12064 and we see a restart back lower then we would like to see a strong early break past 12018 followed by a break through the area between 11977 – 45. Once this occurs we are back down near 11867.

COMMODITIES

GOLD – 1206 ( – 17 or – 1.39% )

Gold made a steady move lower last week as the rumour mill re US Interest rates continued and confirmed by Janet Yellen. If this is the case then why are Traders Buying Gold and Silver at the fastest pace in over a decade?

http://www.zerohedge.com/news/2015-05-23/traders-are-buying-gold-silver-fastest-pace-over-decade

For the upward move to restart we would like to see another attempt at breaking back above 1216 and then through 1226 early in the week before pushing past 1241. Once this is achieved then we could see 1252 which would complete the range.

For the down move to restart 1208 needs to become a strong level of resistance before we see 1192 and possible a full reversion back to the area between 1178 – 80.

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